Strategy in action

9 10 Good Progress on Expense Management Non-Interest Expenses ($ millions) 2,565 2,507 2,395 692 755 685 366 388 352 1,358 1,449 1,422 Q2/11 Q1/12 Q2/12 Other Premises & technology Salaries & employee benefits Scotiabank • Year-over-Year Excluding acquisition-related gains and one-time IFRS foreign currency-related gains, operating leverage was +3.5% Expenses up 7% - Acquisitions accounted for over 80% of increase - Higher expenses related to increased staffing levels - Higher premises and technology costs Quarter-over-Quarter Excluding the real estate gain in Q1/12, operating leverage was +2% Expenses up 2% + Excluding recent acquisitions, expenses down 1% from reductions in most expense categories - Higher performance-based compensation and professional fees Strong Capital Ratios: High Quality Capital Ratios (%) 12.3 12.0 12.2 12.2 11.4 9.6 9.6 9.3 9.4 8.5 Q2/11 Q3/11 Q4/11 Tangible Common Equity Scotiabank Q1/12 Q2/12 Tier 1 • YTD internal capital generation of $1,516MM (vs. $1,604MM in 2011) • YTD stock issued under DRIP: $361MM (vs. $302MM in 2011) • Closed $1.7B common equity issue Remain confident of achieving 7% -7.5% CET1 target by Q1 2013

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